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Compliance News

The latest compliance news items. Past months’ news items are found under the specific Compliance Topic page related to the news item.

Bank members-only content =

June | July

July News

  • ARRC Releases White Paper on Using SOFR Average for ARM Products (7/12/19)
    The Alternative Reference Rates Committee released a white paper that shows how to use an average of the Secured Overnight Financing Rate to structure adjustable-rate mortgages in a way that’s comparable to current ARM loans.
  • FHFA Publishes Methodology for 'PMMS+' Index (7/9/19)
    The Federal House Finance Agency published in the Federal Register its methodology for calculating the new "PMMS+" index. The index will replace the agency’s Monthly Interest Rate Survey, which was used by many lenders to benchmark interest rates on various mortgage products. FHFA ceased publication of the MIRS index in May. The PMMS+ index is derived from Freddie Mac's 30-year FRM Primary Mortgage Market Survey, with adjustments made by FHFA. The agency is accepting comments on the methodology through Sept. 9, 2019.
  • ABA's Letter to CFPB on the Remittance RFI (7/2/19)
    ABA on June 28 filed two comment letters in response to the Bureau’s request for information (RFI) about remittances. The RFI was prompted by the upcoming expiration of a provision that lets depository institutions estimate certain fees and exchange rates when making disclosures to their customers. The ability to estimate will expire in July 2020 and cannot be extended by the Bureau and so the CFPB would like comment on alternative ways to ensure consumers continue to have access to remittances. Read the joint comment letter.
  • Agencies Issue Proposal on HVCRE Treatment of Single-Family Land Development Loans (7/1/19)
    In an effort to clarify their September 2018 proposal for high-volatility commercial real estate (HVCRE) acquisition, development or construction loans, the banking agencies have issued an additional proposal to address the treatment of loans financing the development of land for one-to-four-family residential properties. The agencies are seeking input on whether such loans should be excluded from the definition of HVCRE in their regulatory capital rule. For more information, contact ABA's Sharon Whitaker.
  • ABA: Overdraft Rule Empowers Consumers and Should Not Be Changed (7/1/19)
    Responding to a statutorily required review of the 2009 Overdraft Rule, ABA stated that the 'opt in' rule has empowered customers to make informed choices about seeking or declining overdraft protection services for debit card point-of-sale or ATM transactions. ABA recommended that the Bureau not make any changes to the rule. For more information, contact ABA's Jonathan Thessin.
  • CFPB Updates Compliance Guide for Payday Rule (7/1/19)
    The Consumer Financial Protection Bureau updated its small entity compliance guide for its 2017 final rule governing short-term, small-dollar loans. The updated guide reflects the bureau’s finalization, on June 6, of its separate rule to delay the compliance date of the mandatory underwriting provisions in the 2017 rule. The bureau has proposed to rescind those underwriting provisions, while leaving in place the 2017 rule’s payment provisions. For more information, contact ABA's Jonathan Thessin.

June News

  • Fed, CFPB Issue Final Rule for Reg CC Inflation Adjustment Calculation (6/25/19)
    The Federal Reserve and the Consumer Financial Protection Bureau finalized changes to Regulation CC (the Expedited Funds Availability Act) to adopt a method for making inflationary adjustments to the dollar amounts in Regulation CC every five years pursuant to the Dodd-Frank Act. The adjustments include, for example, an increase in the large dollar exception amount from $5,000 to $5,525. As recommended by ABA, the first adjustments will be effective July 1, 2020. For more information, contact ABA’s Nessa Feddis.
  • ABA Seeks Greater Clarity on Banks’ Ability to Serve Industrial Hemp Businesses (6/25/19)
    In a letter to financial regulatory agencies, ABA called for greater clarification on how banks may serve businesses dealing with hemp—a low-THC strain of marijuana that was removed from the Controlled Substances Act by Congress as part of the 2018 Farm Bill. Despite this legislative action, regulators have yet to issue a clear directive on distinguishing legal hemp and illegal marijuana, leaving many banks uncertain about whether they can legally serve these businesses, ABA noted. The association called for guidance on retail products containing hemp or hemp-derived CBD and the appropriate procedures for sourcing those products back to legal processors.
  • ABA Issues Staff Analysis of CFPB's Updated Rulemaking Agenda (6/18/19)
    ABA has created a members-only staff analysis summarizing recent updates to the CFPB's 2019 spring rulemaking agenda. Significantly, the bureau said it expects to issue a proposed rule in December on the public disclosure of Home Mortgage Disclosure Act data. It also intends to resume pre-rulemaking activities in January 2020 on implementing Section 1071 of the Dodd-Frank Act, which requires the CFPB to collect data on small business lending. The analysis also includes updates on regulatory initiatives at the federal banking agencies, the Department of Housing and Urban Development, the Financial Crimes Enforcement Network and the Department of Labor. For more information, contact ABA's Jonathan Thessin.
  • FDIC Publication to Enhance Compliance Supervisory Transparency (6/14/19)The Federal Deposit Insurance Corporation (FDIC) issued a new publication, Consumer Compliance Supervisory Highlights to increase transparency regarding the FDIC's consumer compliance supervisory activities. The publication includes a high-level overview of consumer compliance issues identified during 2018 through the FDIC's supervision of state non-member banks and thrifts. 
  • Kraninger Outlines Supervisory Burden Reduction Efforts at ABA Conference (6/14/19)
    The federal banking agencies are working to reduce excessive supervisory burdens through automation and shared data submission, Consumer Financial Protection Bureau Director Kathy Kraninger said at ABA's Regulatory Compliance Conference in New Orleans. In her first-ever public remarks to an audience of financial services professionals, she specifically said that she is working to “automate many of the things that are perhaps the biggest pain points” and added that the FFIEC agencies are “working very closely on a joint data intake system.”
  • ABA Supports Proposed Changes to HMDA Reporting Thresholds (6/13/19)
    In a comment letter to the Consumer Financial Protection Bureau, ABA concurred with the CFPB's proposed increase to the threshold for closed-end mortgage loans, recommending that the new threshold be set at 100 and possibly higher (up from 25). ABA also urged the CFPB to remove any requirements related to reporting open-end transactions under HMDA, “as this data lacks value in advancing relevant legislative objectives while imposing very high compliance costs.” At a minimum, the association called for the permanent extension of the temporary coverage threshold of 500 open-end lines of credit. For more information, contact ABA’s Rod Alb.
  • Trade Groups Weigh In on Proposed Changes to Lender Certification Requirements (6/11/19)
    ABA joined three other financial and housing trade organizations in a comment letter to the Federal Housing Administration offering feedback on proposed changes to its single-family loan and lender-level certifications. FHA proposed the changes last month in an effort to encourage greater bank participation in the program. In the letter, the groups called on FHFA to either rescind the annual certification requirement or replace the current annual certifications with “a certification that reinforces the obligation of each mortgagee to establish and operate in accordance with a corporate risk management plan.” They added that such an approach “would more meaningfully foster compliance by each mortgagee with FHA requirements.” For more information, contact ABA’s Rod Alba.
  • FCC Releases Text of Call-Blocking Ruling (6/11/19)
    The Federal Communications Commissions has released the text of its ruling that permitted telephone companies to enroll customers automatically in a call-blocking program designed to identify unwanted calls. The final ruling included important changes to address the erroneous blocking of calls placed by banks and other legitimate businesses, and was effective immediately following the FCC’s vote. For more information, contact ABA’s Jonathan Thessin.
  • CFPB Extends Compliance Date of Underwriting Provisions in Payday Rule (6/7/19)
    The Consumer Financial Protection Bureau extended the compliance date for the mandatory underwriting provisions of its final rule governing short-term, small-dollar loans, from Aug. 19, 2019, to Nov. 19, 2020. The CFPB has separately proposed to rescind those underwriting requirements. For more information, contact ABA’s Jonathan Thessin.
  • FCC Adopts Call-Blocking Declaratory Ruling (6/7/19)
    The Federal Communications Commission unanimously adopted a ruling permitting voice service providers to enroll customers automatically in a call-blocking program designed to identify unwanted calls. The ruling, which is effective immediately, requires that customers be able to opt out of the program. "Our members share the FCC’s goal of eliminating illegal, automated calls," said ABA EVP Virginia O'Neill. "Today's declaratory ruling advances that goal, while at the same time taking an initial step to prevent consumers from missing critically important and time-sensitive calls affecting their financial well-being, health and safety."
  • McWilliams: CRA Reform to Clarify Qualifying Activities, Lending Assessment (6/5/19)
    In remarks at a meeting of community development bankers, FDIC Chairman Jelena McWilliams highlighted several ongoing initiatives at the agency to strengthen and sustain the nation’s community banks, including the highly anticipated reform of the Community Reinvestment Act (CRA) regulations.

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